Russia’s Crude Shipments Slide to the Lowest Since February

Russia’s crude shipments fell to the lowest since February as refinery runs are rising faster than production, eating into exports.

Seaborne crude cargoes averaged 3.12 million barrels a day in the four weeks to July 6, down by 3% from the period to June 29, tanker-tracking data compiled by Bloomberg show.

On this measure, flows have fallen to the lowest since the period ending Feb. 23 and are down by 200,000 barrels a day from March, before eight members of the OPEC producer group, including Russia, began easing output cuts they made in 2023.

Over the closest comparable period, production increased by about 60,000 barrels a day, one-third of the headline increase in the country’s OPEC output target. Meanwhile, refinery runs rose by 140,000 barrels a day.

Output increases permitted to Russia under the OPEC agreement are limited by deeper cuts it pledged to compensate for past over-production. The size of those reductions will continue to grow until September under current plans, likely further limiting the amount of additional crude available for export. The drop in Russia’s exports highlights the gap that is opening up between the OPEC group’s big headline output increases and the much smaller additional volumes actually finding their way to the international market.

In contrast to the four-week average numbers, the more volatile weekly shipments jumped by about 280,000 barrels a day to a four-week high. That increase comes after two weeks of particularly low exports, driven in part by maintenance work at Russia’s largest Pacific export terminal. The four-week average smooths out the big swings in weekly numbers, giving a clearer picture of underlying trends in crude flows.

Lower traffic last week from the Baltic terminals of Primorsk and Ust-Luga was more than offset by higher shipments from all other regions.

A total of 30 tankers loaded 22.96 million barrels of Russian crude in the week to July 6, vessel-tracking data and port-agent reports show. The volume was up from 21 million barrels on 28 ships the previous week.

Crude flows in the period to July 6 stood at about 3.12 million barrels a day on a four-week average basis, down by 90,000 barrels a day from the period to June 292. Using more volatile weekly figures, shipments rose by about 280,000 barrels to 3.28 million barrels a day.

The increase in weekly flows was driven by a rebound in shipments from the Pacific ports of Kozmino and De Kastri and the Arctic port of Murmansk. Those gains were partly offset by lower flows from the Baltic ports of Primorsk and Ust-Luga.

There was one shipment of Kazakhstan’s KEBCO crude during the week from Ust-Luga and two from Novorossiysk.

The gross value of Moscow’s exports rose by about $100 million, or 8%, to $1.36 billion in the week to July 6. The increase in flows was partly offset by lower average prices.

Weekly average export prices of Russian crude slid for a second week, falling more sharply than the wider market.

Urals crude from the Baltic and Black Sea fell by about $1.30 a barrel to average $57.25 a barrel during the week, while the price of key Pacific grade ESPO fell by $1 to average $62.80 a barrel. Delivered prices in India were down by $1.20 at $67.32 a barrel, all according to numbers from Argus Media.

On a four-week average basis, the export price of Russia’s crude shipments rose for a sixth week, with Urals from both the Baltic and the Black Sea rising by about $0.80 a barrel and Pacific ESPO up by $1 a barrel.

Even so, using this measure, the value of exports fell by 1% in the period to July 6 to average about $1.34 billion a week, with the lower flows more than offsetting the small increase in prices.

Observed shipments to Russia’s Asian customers, including those showing no final destination, edged down to 2.73 million barrels a day in the 28 days to July 6, from a revised 2.77 million barrels a day in the four weeks to June 29.

The figures include about 340,000 barrels a day on ships from Western ports showing their destination as Port Said or the Suez Canal, or those from Pacific ports with no clear delivery point, and a further 30,000 barrels a day on tankers yet to signal a destination.

Flows to Turkey in the four weeks to July 6 averaged about 370,000 barrels a day, down about 30,000 barrels a day from the revised figure for the previous week. Shipments to Syria averaged about 25,000 barrels a day.

This story forms part of a weekly series tracking shipments of crude from Russian export terminals and the gross value of those flows. The next update will be on Tuesday, .

All figures exclude cargoes identified as Kazakhstan’s KEBCO grade. Those are shipments made by KazTransoil JSC that transit Russia for export through Novorossiysk and Ust-Luga and are not subject to European Union sanctions or a price cap. The Kazakh barrels are blended with crude of Russian origin to create a uniform export stream. Since Russia’s invasion of Ukraine, Kazakhstan has rebranded its cargoes to distinguish them from those shipped by Russian companies.

Bloomberg classifies ship-to-ship transfers as clandestine if automated position signals appear to be switched off or falsified — a tactic known as spoofing — to hide the two vessels involved coming together to make the cargo switch.

Vessel-tracking data are cross-checked against port-agent reports as well as flows and ship movements reported by other information providers including Kpler and Vortexa Ltd.

If you are reading this story on the Bloomberg terminal, click for a link to a PDF file of four-week average flows from Russia to key destinations.

With assistance from Sherry Su.

This article was generated from an automated news agency feed without modifications to text.